Illinois turning to insurance
agents for Obamacare outreach
Naperville insurance agent Robert Slayton talks to potential clients Jeanne and Ralph Wysocki on Jan. 8, 2015.
(Chuck Berman, Chicago Tribune)
By Wes VenteicherChicago Tribunecontact the reporter
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Health Insurance
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Healthcare Policies and Laws
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Insurance
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Affordable Care Act (Obamacare)
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Medicaid
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Naperville
Illinois partnering with insurance salespeople on Obamacare outreach efforts
Unlike navigators, insurance agents can recommend certain Obamacare plans (and earn commission)
Keith Kelly knew buying health insurance would be complicated. So the 55year-old Naperville man skipped the federal enrollment website and asked for
help from someone he knew: an insurance salesman.
Kelly told insurance agent Robert Slayton about his underactive thyroid, his
need for a chiropractor and other health specifics. After a briefing on
deductibles, copays, drug costs and other insurance provisions, Kelly and his
wife settled on a Blue Cross Blue Shield plan for which the couple pays about
$700 per month.
"There are so many variables, and (Slayton) put them into easily
understandable piles for us to go through and make our own informed
decisions with his help," Kelly said.
As 272,600 Illinoisans enroll in Obamacare, Land of Lincoln picks up speed
Insurance agents have so far played a limited role signing people up for
Affordable Care Act insurance in Illinois, where the state has focused on
federally funded navigators to inform people about their options and help
them buy plans or enroll in Medicaid.
But with future funding for the navigator program uncertain, the state is
expanding the role of insurance agents in its outreach efforts.
Get Covered Illinois, the state's enrollment arm, is spending about $150,000
this winter to help 13 insurance brokerages pay for co-branded marketing
materials, said Jennifer Koehler, Get Covered Illinois' executive director. The
site getcoveredillinois.gov lists about 150 insurance agents who have
completed state training courses in Medicaid and data security.
Unlike navigators, insurance agents can ask people specific questions about
their health and then recommend a specific plan or insurer. Insurers pay
agents a commission on plans sold, usually a percentage of the premiums.
Consumers should be aware that creates an incentive for agents and brokers to
sell higher-priced plans, said Abe Scarr, director of the Illinois Public Interest
Research Group.
"There are not necessarily enough protections in place to make sure that that's
not happening," Scarr said.
Navigators are forbidden from accepting payments from insurers. Consumers
also can compare plans on their own by using the healthcare.gov website.
Agents say their commission on health plans in Illinois is around 6 percent of
premiums — much less than they receive for selling other types of insurance.
Sometimes insurers pay a flat fee instead.
The financial motivation for agents could help consumers in the long run by
boosting the number of people with health insurance, said Barbara Otto, CEO
of Health and Disability Advocates, a nonprofit that has been involved in state
health initiatives.
"Who's going to be enrolling populations after 2015, after 2016, after 2017? So
we started investing in brokers," Otto said.
For some health insurance shoppers, the specific recommendations agents can
offer make it easier to pick a plan, said Slayton, president of Naperville-based
brokerage Robert Slayton & Associates and a former president of the Illinois
State Association of Health Underwriters.
"An agent can do the same thing (as a navigator), but at the same point in time
they can advise the person based on their personal health on what they need,"
he said.
Agents can also draw on their experience to help customers pick an insurer,
Slayton said. For example, an agent could tell a customer that one insurer
typically pays claims more reliably than another.
Agents receive no commission for selling Medicaid plans. They usually refer
people who are eligible for Medicaid to navigators, several Chicago-area
agents said.
The restriction on navigators recommending specific health plans is a product
of negotiations between state officials and insurance agent groups before the
federal marketplace came online, said Phil Lackman, executive vice president
of Independent Insurance Agents of Illinois.
"We still believe, in the majority of cases, that consumers want the assistance
of an agent or broker," Lackman said, while acknowledging that in some parts
of the state there are few licensed agents.
The federal government created and funded the navigator program to enroll
people in private plans and Medicaid, the state insurance program for the poor
and disabled.
Illinois is spending about $25.8 million in federal money on more than 900
navigators' salaries for the open enrollment period ending Feb. 15. State
health officials have applied for money to keep the program going at least
through next year's open enrollment, but it's unclear how much they will
receive, state spokesman Mike Claffey said.
Small employers grapple with rising health insurance premiums
Agents have traditionally helped small businesses manage health care plans
and are well suited to reaching the working poor, a population that is
important for the health law's sustainability, said Otto, of Health & Disability
Advocates.
Of the 900,000 working-age Illinoisans who became eligible for insurance
through the Affordable Care Act's federal marketplace, only about a quarter
signed up during last year's open enrollment period, according to an analysis
of census data by Illinois Health Matters, the research arm of Health &
Disability Advocates. About 63 percent of the 900,000 are employed,
according to the analysis.
"If we want to reach that population, which is largely the working poor, we
have to go to where they're working. We have to be a little more innovative,"
said Otto.
Most of the employed people who are eligible for marketplace plans work for
small businesses or franchises, according to a Health & Disability Advocates
report.
Insurance agents can help small businesses use the federal marketplace's
Small Business Health Options Program, known as the SHOP marketplace, or
can help workers pick plans individually if their employer doesn't offer
insurance, the report suggests.
Making a profit from selling Affordable Care Act health insurance plans is
difficult, said George Kleanthis, an agent with Woodridge-based Hartland
Insurance Services, which started selling the plans in the current open
enrollment period. But selling that coverage helps find clients who might be
interested in life, auto, home and other types of insurance that pay higher
rates, agents said.
Hartland has taken a similar approach to enrolling clients that navigators have
taken — setting up tables at community events, going to churches and schools,
holding town-square style meetings focused on health insurance.
"It's a challenging business to be profitable in, but if you structure properly,
and you're able to scale a business, you can make money," Kleanthis said.
This story was produced in partnership with Kaiser Health News, an
editorially independent program of the Kaiser Family Foundation.
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